New Zealand Gazette – 1998 – No. 156

Page 3730

✨ Financial Statements



NEW ZEALAND GAZETTE

No. 156

BAY OF PLENTY ELECTRICITY LIMITED

Special Purpose Financial Statements

Electricity (Information Disclosure) Regulations 1994

Notes to the Financial Statements

for the 12 Months ended 31 March 1998

22 Capital Contributions

The Company has commitments for future capital expenditure amounting to $372,196 ($12,579,147 in 1997).

23 Financial Instruments

(a) The nature of activities and management policies with respect to financial instruments is described as follows:

Interest Rates

(i) The Company generally uses fixed rate loans to manage interest rate risk. The total level of fixed rate funding at 31 March was $20,000,000 (1997 $14,500,000), having a fair value of $19,695,145 (1997 $14,303,326).

In addition, as at 31 March 1998, the face value of the instruments the Group held were as follows:

Interest Rate Options: Rate Term Commencement Date Group 1998 $000 Group 1997 $000
Swap 7.6% 3 Years 7 November 1997 3,500 -
Swap 8.3% 2 Years 24 March 1998 1,000 -
Swap 7.1% 5 Years 3 April 1998 13,000 -
Swap 7.9% 16 Months 24 November 1997 2,500 -
Swap 7.7% One Year 24 November 1997 4,000 -
Cap 8.7% One Year 3 March 1997 - 13,000
Floor 8.0% One Year 3 March 1997 - 13,000

(ii) Credit

In the normal course of its business the Company incurs credit risk from trade debtors and financial institutions. There are no significant concentrations of credit risk. The Company has a credit policy which is used to manage this exposure to credit risk. As part of this policy, limits on exposures have been set and are monitored on a regular basis. The bank risk is reduced by spreading short term investments over high credit quality financial institutions.

(iii) Foreign Exchange

The Company has, in this reporting period, conducted transactions in Foreign currencies for the purpose of capital expenditure. The Company policy is to fully hedge out foreign currency exposure by using Forward Rate Agreements (FRA) and currency options during this period.

Any gains or losses associated with hedging instruments are offset by the underlying exposure.

The contract amounts of foreign instruments outstanding at balance date are as follows:

Group 1998 $000 Group 1997 $000
Forward Rate Agreements 299 -


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✨ LLM interpretation of page content

🏭 Bay of Plenty Electricity Limited Financial Performance (continued from previous page)

🏭 Trade, Customs & Industry
Electricity, Financial Statements, Bay of Plenty, Regulations, Revenue, Operating Expenses, Surplus, Taxation, Share Capital, Reserves, Dividends, Investments, Joint Venture, Imputation Credit Account